Last week Facebook (FB) changed the game for social media as an investment. Before FB's boffo earnings report, the rap on the social media space was that they were generally a nice idea but would never be able to make much money, especially once users migrated from desktops to smartphones.
One huge quarter later and it's time to rethink the entire concept. It turns out there actually is money to be made in those little on-line social clubs. The hard part is distinguishing between glorious Facebook and grizzly Zynga (ZNGA).
Simon Baker, CEO of Baker Avenue Asset Management, says investors should be ready to join the social media club.
"Ad sales are going up, user engagement even in the younger people is going up, margins are going up," he says. "I think it's pretty positive. The two names we like in the space are Yelp (YELP) and LinkedIn (LNKD)."
Lumping the two companies together demonstrates how wide a brush is used when people think of social media. Much like all online companies used to be referred to as dot-coms, every company that takes advantage of the collective nature of the online world is a social media company.Read More »from The Facebook Effect: Time to Buy Social Media Stocks, Says Baker